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South Korea To Kill the Coin in Path Towards 'Cashless Society' (cnbc.com)
The central bank in South Korea, one of the world's most technologically advanced and integrated nations, is taking a major step in getting rid of coins in the nation in what is an attempt to become a cashless society. The first step is to get rid of the metal, a feat authorities hope to achieve by 2020. From a report on FT: The Bank of Korea on Thursday announced it will step up its efforts to reduce the circulation of coins, the highest denomination of which is worth less than $0.50. As part of the plan it wants consumers to deposit loose change on to Korea's ubiquitous "T Money" cards -- electronic travel passes that can be used to pay for metro fares, taxi rides and even purchases in 30,000 convenience stores. The proposals are just the latest step for a nation at the forefront of harnessing technology to make citizens' lives more convenient. Online shopping is the norm, as are mobile payments for the country's tech-savvy millennials. South Korea is already one of the least cash-dependent nations in the world. It has among the highest rates of credit card ownership -- about 1.9 per citizen -- and only about 20 percent of Korean payments are made using paper money, according to the BoK. But while convenience is at the crux of the central bank's plan, there are other considerations. The BoK spends more than $40m a year minting coins. There are also costs involved for financial institutions that collect, manage and circulate them.
Make money worthless, make every transaction traceable.
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Nobody wants a cashless society except the people who stand to skim a percent off every financial transaction and the government, who wants to be able to trace every credit and debit ever made.
The short short version of this rant:
- Banks want to get rid of cash so you CANNOT withdraw from the banking system. Currently, if you really don't want to deal with banks, you can pull your money out in the form of cash, and transact WITHOUT them. They don't like this. They want COMPLETE CONTROL of your money. This way they can charge whatever fees or negative interest rates they want.
- Governments want the cashless society so they can MONITOR EVERY TRANSACTION. This gives them more control, and greater tax revenue at the expensive of privacy and freedom. Also, piss off the wrong bureaucrat or policeman, and poof, they push a button and all your money is frozen. You can't buy food, pay your rent, or pay a lawyer to get the money unfrozen.
Oppose the cashless society.
IRS wet dream!
Homelessness is almost nonexistent because people with mental disorders generally aren't allowed to wander free in Korea. However, the living conditions in some areas are not up to First World snuff.
Also, the whole country smells like an open sewer and stale tobacco.
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I wish the US would get rid of pennies and nickles, rounding everything to 10 cents. Or maybe even ridding the dime, and rounding to nearest 25-cents. The hard part is doing it without too many side-effects.
Table-ized A.I.
Homelessness is almost nonexistent because people with mental disorders generally aren't allowed to wander free in Korea
That's awfully patronizing. Homeless don't always have mental disorders, sometime you are in a transient situation, sometime you want to say a big "fuck you" to materialistic way of life. Also, it is very telling about the obvious lack of personal freedom of Korean society.
When cash is no longer "in your hand" then it's no longer in your control. A cashless society is a VERY slippery slope and needs to be treated as such.
Small moves are necessary to ensure that there are adequate solutions to the fears and doubts that people will inevitably have about such a move.
A cashless society means you are at the financial mercy of whomever is in control of the little 1s and 0s in the financial sector.... and it won't be you!
Until Kim Jong Un decides to EMP the south.
General Relativity: Space-time tells matter where to go; Matter tells space-time what shape to be.
still shortsighted, but I guess a billion times better than what India is going through right now.
Make no mistake people. All this crap around cashless society has absolutely zero to do with the costs of production, and all to do about population control, bank power, and the end of privacy. Once cash stops existing, that's it... you have zero independent financial control. All your earnings will be at banks hands. All the more reason for banks to exploit clients, toy with their money, and hold a get out of jail free card if they f*ck things up.
I guess one could say that we're already too deep into the whole sh*t swamp to go back, specially in cases like South Korea, but this is kinda the equivalent in economy terms of solving poverty by killing all the poor people.
Cash, in all countries, is the type of revenue that all the poorest, excluded from society, in the most fragile parts, minority conditions and whatnot depends on. Killing cash won't solve their problems, it'll only aggravate things.
But I don't need to talk much about it. We'll soon see the resulting catastrophe that will happen in India if they don't revert the decision. It'll be a huge shitshow. I don't even know if there will be anything recognizable left of the country a year from now if they continue going that way, mark my words.
Overnight and without warning, the government banned bills worth more than about $1.50. The result has been an absolute disaster:
Banks and ATMs are running out of what little cash their is shortly after they open.
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The only good thing is I'm approaching 60 years old, so by the time (hopefully 20+ years or longer from now), I'll be sitting in a chair, spitting up and wearing diapers, watching wheel of fortune and mumbling to myself and won't care.
living on the fringes of society by dropping off the map isn't a way to live, son. If you're trying to disappear from the world you've already lost the battle. Instead of worrying about that do something about income inequality. Do something about Wage Slavery. Put systems in place to prevent economic abuses. There's a reason Donald Trump's got a hot wife, and it's not his winning personality...
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Seriously think about how kids learn how to use and appreciate money - using an ATM card is just not the same as holding coins, counting them, feeling the weight in your pocket.
And (USA I'm looking at you) start including sales tax in advertised prices - explaining to a 5 year old that yes he has enough for that ice cream, but he has to calculate 6% in his head and add that to the price, is just insane
To describe it as a disaster is a bit much. Yes there are long queues outside banks and a lot of ATMs weren't functioning for a while, but a 97% cash based economy in the 21st century is just ridiculous. I'm certainly no fan of the present government but this is the one good idea they've managed to come up with. There's a lot of considered opinion for and against the move, but here's my first person view.
1. You absolutely should not be able to buy a house or a car in cash - yet this is pretty much the norm across much of the country, more so in the secondary market where the amounts changing hands are larger. This means widespread tax evasion at every level, and an unfair burden on those who are part of the 'organised' economy and pay income tax (around 3% of the population).
2. India happens to have a rather annoying neighbour who has set up currency presses for the sole purpose of generating counterfeit Indian currency. Sure, they'll probably start printing the new notes as easily after a while but if the overall cash portion of the economy reduces, the impact of fake currency also does
3. People have inordinate amounts of cash lying around - and I'm talking regular average people. It's not because they have some lofty ideals about anonymity or government interference, just because they can't be bothered to use the banking system. If all that idle money (we're talking 10s of billions of dollars here) were put to work interest rates would drop, more resources for infrastructure building would be available and so on
Make money worthless, make every transaction traceable.
If you have a cell phone you're already tracked 24/7 as long as you carry it, unless you get both a new phone (IMEI) and SIM card (IMSI) on a regular basis.
There is more than one form of tracking. This isn't about tracking your physical location, but your financial transactions. What you buy, when, where and from whom provides much more information about you than your location does. Hell, if they know enough about your interests and habits, they can predict where you will be when, no physical tracking required.
"What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
Every assertion you have made is lacking the critical thinking 'Why?'
Why is a 97% cash based economy "just ridiculous?"
What is ridiculous and why is it bad?
It's bad because it facilitates corruption on multiple levels. Go to a store to buy something and inevitably the question pops up of whether you want a bill. The vendor offers you a discount if you pay cash and don't ask for a bill because that way he evades sales tax on that transaction. Most people would gladly pay cash and take the discount. With a card swipe the vendor has no choice but to account for the transaction and pay the tax on it. Multiply this across every store in the market, add gas stations, hospitals, basically anywhere money changes hands in cash and imagine the scale of tax evasion. Many people feel a sense of unfairness at the prospect of their income tax being deducted at source (@marginal 30%) when traders and business owners are getting by paying only a fraction of what they're supposed to.
Why should people not be allowed to purchase specific items with cash? Who decides that and why?
The majority of those paying cash aren't doing so just for the pleasure of it. They're doing it for a very specific purpose - to evade taxes. If the indirect tax net is broadened by discouraging these "off the books" transactions the government would be able (in theory at least) to rationalise direct taxes for the middle class who currently bear a good share of the income tax burden. Consider that over 50% of total tax revenues come from direct taxes (i.e. income tax) which are paid by less than 5% of the population. Note: this isn't the top 5% either.
Why is India an "annoying neighbor?" Why does that matter? Why is that relevant to what they do within their borders with their own currency system?
Okay, I'll count this one as a reading comprehension fail. My point was that India has an annoying neighbour that actively counterfeits Indian currency.
Why does it matter if people "can't be bothered to use the banking system?"
It matters because the promotion of a shadow economy has several drawbacks including rising tax rates, constraints on public sector spending and making econometric figures unreliable
Why is the banking system better? What does it provide that cash does not to the people that prefer cash?
How about security from theft and opportunities to earn interest?
Why do you believe interests rates dropping would be a good thing for people that can't take advantage of it?
It doesnt matter what I believe. The fact is lower interest rates are a significant factor in promoting and sustaining overall economic growth and economic growth leads to reduction in poverty levels
Why do you think that interest rates dropping would naturally lead to better infrastructure?
Not interest rates but increased tax revenues means more public funds available for infrastructure projects.
Why should someone that has cash let other people make money off of their work?
Oh I don't know - maybe because they benefit from public services like roads, sanitation and public healthcare?
Your post is